Trader who called 2017 Bitcoin price crash raises concerns over ‘double top’

Bitcoin (BTC) could form a so-called “double top” pattern after dropping more than 30% from its record high of $69,000, notes Peter Brandt, a veteran trader known correctly as the December 2017 crypto market top.

CEO of Factor LLC remember Bitcoin’s inability to extend price rally above all-time high near $65,000 after the second attempt. Meanwhile, it indicated an immediate support level for BTC price at the so-called neckline near $30,000 while warning of further declines below this key level.

BTC/USD weekly price chart featuring a double top pattern. Source: TradingView, Peter Brandt

Is Bitcoin’s 50% Collapse Real?

In detail, traditional chartists see the formation of two consecutive tops, each of which leads to a strong price rebound to the downside, as evidence of a bearish reversal. The bearish target in the double top scenario is approximately as deep as the height of the formation.

but the The upper double downside target is somewhat unrealistic here because a confirmation of the pattern would suggest a drop of approximately $35,000 in the bitcoin price. Meaning that the price of BTC would be at risk of falling below $0 in an ideal world, which is a highly unlikely scenario.

However, if the price breaks lower below the $30,000 neckline, Bitcoin’s ultimate downside target could turn to the 200-week exponential moving average (200-week exponential moving average; orange wave in the chart below), currently About 50% below the current price levels, near $23,500.

BTC/USD daily price chart featuring 200-week EMA support. Source: TradingView

The 200-week exponential moving average has been useful in identifying bottoms in a bear market, as indicated by the upwards-pointing arrows in the chart above. However, Brandt stated:

“A chart pattern is not considered a chart pattern until it has been completed and confirmed. Until then, it is just a matter of conveying the attention to me.”

Just another drop in the price of bitcoin?

Ignoring a possible bearish outlook, Bitpanda Chief Product Officer Lukas Enzersdorfer-Konrad confirmed that Bitcoin’s price drop from $69,000 to $42,000 is similar to its price crash in May 2021, dropping more than 50%, only to make up for all these losses and hit a new one. Record high later.

“Similar to the recent decline, over-leveraged positions increased volatility and wiped out most long positions,” Enersdorfer Konrad told Cointelegraph in an emailed statement. , which caused a correction of about 20% on the day in most liquid crypto assets.

The analyst added:

“The bitcoin market needs some time to recover in these situations, the intraday charts are still choppy, but still bullish on the higher time frame.”

Related Topics: Bitcoin Drops Below $47K Eliminates October Gains – Bear Market Begins?

From the point of view of bullish technologies, an independent market analyst known by the nickname “Wolf”, Foot Bitcoin as an oversold asset based on the Relative Strength Index (RSI) readings on the daily time frame chart.

BTC/USD daily price chart showing the RSI bounce. Source: TradingView, IamCryptoWolf

Wolf predicts bitcoin price will test $51,780 as its next resistance level, with an extended upside target near $60,000.

The opinions and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risks, you should do your own research when making a decision.